The Feds Are Investigating 50 Former Bank Executives

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Fear the accountants with guns. Photo: Reuters

The Journal reports that the FDIC, which insures banks, and the FBI are conducting criminal investigations into at least some of the people responsible for driving the banking system into a ditch (over 300 banks have failed since the start of 2008). There also will be an increased effort to collect fines:


FDIC officials also are ramping up efforts to use civil litigation to recover money from former bank officials. Hundreds of "demand" letters have been sent to former executives, directors and other employees, as well as their professional-liability insurers, putting them on notice of potential claims, the FDIC says.


The agency's board has authorized the filing of lawsuits seeking to recover more than $2 billion from more than 80 officers and directors of failed banks. The total is up from about 50 approved suits as of last month, seeking more than $1 billion.


It's expected that, as time goes on and more information trickles out, the number of civil and criminal investigations will only go up.

U.S. Sets 50 Bank Probes [WSJ]